As many people who have been buying gold and silver are well aware the “paper market” (COMEX, LBMA) price of gold is used in determining the price for physical gold and silver. This has lead to many people claiming the price of gold and silver is easily manipulated. It’s been rumored for some time leverage on the LBMA is around 100 to 1 (contracts vs. physical). This in essence, allows someone to “create” gold by simply selling “supplying” the market with gold that does not exist. And this creates the possibility for a HUGE scandal in the gold and silver market. The way this scandal is exposed is simple… DEMAND DELIVERY!
Recent events causing a run on physical gold:
- Gold price was crushed over the course of 2 days losing 13% of its value, it does seem a bit extreme. This drop in price caused thousands of people on the sidelines waiting to buy gold and silver to jump at the chance for cheap metals.
- The scandal in Cyprus: The Cyprus government decided it’s OK to steal the wealth of others to pay for bad investments by banking institutions.
- ABM Amro halts physical gold delivery
- Germany decides to remove gold from the United States. Answers have never been provided as to why it’s taking so long for Germany to get its gold.
The above reasons are deteriorating trust in the system. If you don’t know, trust is the foundation for a fraction reserve banking system (the only thing we have to fear is fear itself. That and people taking delivery of gold). When the trust breaks down all hell can break loss, and quickly. When trust is removed people turn to the most reliable form of money the world has ever known, and boy ohh boy people are saying Hello, to the “barbaric relic”.
US Mint sales of gold and silver coins are soaring like Cheech and Chong on a week long bender.
US mint out of 1/10th oz. gold coins
US mint gold sales for April most sold in mint history
India is buying gold faster than the Obama administration can bat away political scandals.
Chinese citizens are consuming metals like a pack of starving fat kids at a doughnut factory.
China gold imports to keep growing after hitting record high
Chinese housewives buy 300 tons of gold
JP Morgan vaults are depleting faster than kegs at a Frat party
JP Morgan eligible gold plummets 65% in 24 hours
COMEX Gold inventory is becoming as bare assed as a nudist colony.
Mints, Refineries, Brokerages out of stock – COMEX gold inventory plummets
Forklifts in GLD’s vault are running around like a cat with its ass on fire.
Chart of the day GLD gold exodus
GLD inventory down from 1,349.92 metric tonnes to 1,078.54 metric tonnes
If the price of gold drops below $1,000, as I’ve heard many analyst predicting, I’ll have an easier time finding a Yeti raping a Unicorn, than gold coins or gold bars.
Keep in mind this gold and silver is going into what I consider “strong hand” investors. They’re not looking to buy gold and silver today and turn it for a couple bucks profit tomorrow (that’s what the paper markets are used for) they’re looking to protect their wealth from inflation/confiscation (think Argentina/Cyprus).
If you’re a person who believes in the manipulation theory of gold and silver, evidence of your beliefs could soon be realized. After all it’s easy to create paper contracts out of thin air, that mining gold and silver out of the ground seems to take a lot of time and energy.
Source: Coin Values.com
